WTI breaks to 4-month high after the rate of oil supply falling below expectations, helping support CAD and drive USDCAD lower
I had previously argued an upside break due to the fact we had seen an increasing amount of large speculators initiate long positions, whilst the futures curve was in contango (prices priced higher further into the future).
We could argue that this confirms a Double Bottom pattern but at this stage I will keep my targets reserved. We need to break convincingly above $60 for the Double Bottom pattern to stand any chance of hitting the projected $66.23 target.
Going into Europe WTI appears keen to break to new highs, with a break above $57.65 targeting $59.38-$60. Also note we are now within a bullish channel, with the upper resistance channel suggesting $60 to be hit in three sessions.
We have a host of US data over the next couple of days so any string data should see a retracement on WTI and other commodities. Therefor we can be on the lookout for retracements towards the original $55 breakout level and potential bullish signals to enter long next week.